Kroll Bond Rating Agency Assigns Preliminary Ratings to JPMBB 2014-C19

NEW YORK--()--Kroll Bond Rating Agency (KBRA) is pleased to announce the assignment of preliminary ratings to 15 classes of the JPMBB 2014-C19 transaction (see ratings listed below). JPMBB 2014-C19 is a $1.4 billion CMBS conduit transaction collateralized by 69 fixed-rate commercial mortgage loans that are secured by 100 properties.

The loans have principal balances ranging from $1.5 million to $125.0 million for the largest loan in the pool, which is secured by The Outlets at Orange (8.9%), a 787,697 sf retail outlet center located in Orange, California. The five largest loans, which also include NSP Multifamily Portfolio (8.5%), 470 Vanderbilt Avenue (7.1%), Arundel Mills & Marketplace (6.4%), and 55 Broadway (5.0%), represent 35.8% of the initial pool balance, while the 10 largest loans represent 52.5%. Loans representing 53.8% of the pool balance have 10-year terms, and the remainder of the pool is comprised of loans with terms of five years (35.0%), seven-years (8.5%), and 20-years (2.7%). A sizeable portion of the aggregate pool balance (65.8%) consists of loans with interest only (IO) periods, which is represented by both full-term IO (36.4%) and partial term IO (29.4%) loans.

KBRA’s analysis of the transaction incorporated our multi-borrower rating process that begins with our analysts' evaluation of underlying collateral properties' financial and operating performance, which determine KBRA’s estimate of sustainable net cash flow (KNCF) and KBRA value using our CMBS Property Evaluation Guidelines. On an aggregate basis, KNCF was 4.2% less than the issuer cash flow. KBRA capitalization rates were applied to each asset’s KNCF to derive values that were, on an aggregate basis, 34.8% less than third party appraisal values. The pool has an in-trust KLTV of 99.8% and an all-in KLTV of 103.4%, which was skewed by two loans, The Outlets at Orange and Arundel Mills & Marketplace, which are low leveraged. Without these loans, the in-trust KLTV and all-in KLTV are 104.7% and 108.9%. respectively. Each of the two loans has credit characteristics which are consistent with a ‘BBB-‘ rated obligation when analyzed on a stand-alone basis.

For complete details of the analysis, please see our Presale Report, JPMBB 2014-C19, published today at www.krollbondratings.com. The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.

 

Preliminary Ratings Assigned: JPMBB 2014-C19

Class   Expected Rating   Balance
A-1   AAA(sf)   $67,211,000
A-2   AAA(sf)   $318,698,000
A-2FL   AAA(sf)   $150,000,000
A-3   AAA(sf)   $112,365,000
A-4   AAA(sf)   $276,298,000
A-SB   AAA(sf)   $62,128,000
X-A(1)   AAA(sf)   $1,085,370,000
X-B(2)   AA(sf)   $89,860,000
X-C(3)   NR   $105,717,769
A-S   AAA(sf)   $98,670,000
B   AA-(sf)   $89,860,000
C   A-(sf)   $63,431,000
EC(4)   A-(sf)   $251,961,000
D   BBB-(sf)   $65,193,000
E   BB(sf)   $31,715,000
F   B(sf)   $17,620,000
NR   NR   $56,382,769
CSQ(5)   NR   $21,703,000
   

1 Notional balance equal to the aggregate certificate balance of the Class A-1, A-2, A-3, A-4, A-SB and A-S certificates and the Class A-2FL/FX regular interest.
2 Notional balance equal to the certificate balance of the Class B certificates.
3 Notional balance equal to the aggregate certificate balance of the Class E, F, and NR certificates.
4 Represents the maximum amount of Class EC certificates that could be issued.
5 Loan specific class of certificates that is only entitled to distributions from payments received with respect to the non-pooled component of the Centreville Square loan.

Related publications (available at www.krollbondratings.com):
CMBS: JPMBB 2014-C19 Presale Report
CMBS: U.S. CMBS Multi-Borrower Rating Methodology, published February 23, 2012
CMBS Property Evaluation Guidelines, published June 10, 2011

About Kroll Bond Rating Agency

KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).

Contacts

Analytical:
Ed Barrett, 215-882-5845
ebarrett@kbra.com
or
Ravish Kamath, 646-731-2328
rkamath@kbra.com
or
Yee Cent Wong, 212-731-2374
ywong@kbra.com
or
Darrick Antell, 646-731-2338
dantell@kbra.com

Sharing

Contacts

Analytical:
Ed Barrett, 215-882-5845
ebarrett@kbra.com
or
Ravish Kamath, 646-731-2328
rkamath@kbra.com
or
Yee Cent Wong, 212-731-2374
ywong@kbra.com
or
Darrick Antell, 646-731-2338
dantell@kbra.com